That lower outlook is expected to reduce the fast-food chain's earnings by about 2 cents a share on the quarter. Looking further out to fiscal 2006, Jack in the Box expects earnings of $2.50 to $2.54 a share versus the average analysts' estimate of $2.60 a share compiled by Thomson First Call. Shares of Jack in the Box ended the day down almost six bucks at $27.70 after scraping to a 52-week low of $27.51 during the session. The company also announced the launch of a $150 million stock repurchase program and affirmed its commitment to become a national restaurant chain. In addition, Jack in the Box is canceling its test of the JBX Grill concept, and as a result will take a charge of 5 cents a share.
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Warning hammers Jack in the Box
Before the open of trading, Jack in the Box lowered its fiscal fourth-quarter same-store sales growth forecast to 1.5% from a previous 3%. The company said the cut was due mostly to lower than anticipated sales of its "Ultimate Club" sandwich and higher gasoline prices, "which may now be impacting consumer habits."
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